GDP was good but not that great. Economic growth went faster in the first quarter of 2013 but was still below the expectations made by analysts. US gross domestic product expanded at a 2.5 percent annual rate in the first three months of the year according to the Commerce Department. It was attributed to the acceleration in consumer spending, business investment and housing.
The last quarter of 2012 was so stagnant that the 0.4 percent annual rate increase was too small compared to the forecast of at least 3 percent made by analysts. Economists said that much of the pattern of growth within the components met their expectations.
Analysts warned that the increase in the first quarter could be as good as it gets for the year as businesses and consumers begin to feel the impacts of the sequester and the expiration of the payroll tax cut.
The Federal Aviation Administration had to furlough air traffic control workers due to the federal spending cuts caused by the sequester. This resulted to delays in flights across the nation. The FAA announced that more than 1,200 delays in the system were from staffing reductions due to the furlough.
Congress tried to resolve to the delays as soon as possible. The Senate passed an overnight bill to stop the furloughs. The House also passed a similar bill Friday. President Barack Obama is expected to sign it into law that would allocate up to $253 million to the agency to stop the reduced staffing and operations until September.
Jobless claims dropped again for the second straight week in a row. The initial claims fell by 16,000 to 339,000 according to the Labor Department. The number was lower than analysts’ estimates, which was an encouraging indicator that the job market is improving.
Existing home sales were down in the week but new home sales and home prices improved. Economists see these as good indicators that the housing market is still improving.